While His Base Rages, Obama Faces Tax-Cut Reality

Thus Obama lauded the health care bill jammed through Congress by Democratic leaders and, addressing liberal complaints that it lacked a public option, said it could be expanded as Medicare was. That might mollify liberal Democrats but will repel independents, who opposed and still oppose Obamacare by wide margins.

Obama did argue that "tax breaks for wealthy individuals" are unpopular and would prove a political liability for Republicans in 2012. But for every poll supporting that proposition you can find another going the other way -- it all depends on how the question is worded.

The strongest part of the press conference came when Obama told liberal Democrats that robust economic growth will make everything easier. That's true: Robust growth produces a boom in revenues far beyond what government statistical models predict. In 1995, Bill Clinton refused to even promise to balance the budget, but the tech boom generated enough revenue to do so a few years later.

But that raises the question of why the economy has been growing at such a limp rate two years into the Obama administration. The specter of higher taxes on high earners -- delayed now for two years, but still threatened by the president -- surely has done something to choke off growth.

So has uncertainty about the extent and cost of the administration's regulatory policies -- which are not limited by the deal on taxes. Extension of unemployment benefits, arguably good policy at a time when jobs are genuinely scarce, tends to perpetuate unemployment as the economy grows, by inducing some workers to hold out for higher-paying jobs.

The tax deal is certainly better for the economy than political gridlock over extending the tax cuts. How much better is uncertain.

But the Democratic base seems more interested in expanding government than in stimulating the economy. They are bellowing with rage not so much at Obama but at the reality that he is grudgingly acknowledging. They had their time, and now it's gone.

Michael Barone, senior political analyst for The Washington Examiner (www.washingtonexaminer.com), is a resident fellow at the American Enterprise Institute, a Fox News Channel contributor and a co-author of The Almanac of American Politics. To find out more about Michael Barone, and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate Web page at www.creators.com.
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